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While not a flood following a dry spell, but the environment improved for stock market listings in London during the course of last year. H1 was properly parched as new US trade policies disrupted markets: fundraisings from flotations were the lowest in a prolonged slump that started 2022. But statistics show a notable pick-up in activity in the latter six months, albeit still billions away the levels of 2021.

Good News for the Exchange and the Chancellor

This uptick is likely a welcome sight for both the London Stock Exchange and the finance minister. For the exchange, the lack of new listings – as opposed to capital raises by existing companies – has become an embarrassment in the past few years, particularly after the UK failed to land the major listing of technology firm Arm Holdings in 2023. At the same time, the finance chief is trying to talk up the benefits of investing in stocks, a endeavor that is simpler when there is a regular stream of market entrants.

2025's Entrants

Not all of last year's listings can be described as widely recognized brands. The most significant debut was Texas-based data centre real estate group Fermi – and that was a simultaneous listing with the US Nasdaq exchange. More familiar UK names included the canned fish producer Princes Group, which secured £400m, and the specialist lender Shawbrook.

"The pipeline this year is strong evidence of things to come, with numerous firms in advanced preparations for a flotation in London in 2026," comments LSE chief executive Julia Hoggett.

Her view seems justified. Equity valuations are high, which incentivizes shareholders to monetize their stakes. And, the merry-go-round of private equity funds selling assets to each other may have reached its natural limit; the public markets, the more traditional venue, looks increasingly appealing.

Prospects for Next Year

A key potential listing of 2026 should be Norwegian Visma, one of the continent's largest software companies, with 17,500 employees. The LSE first needs to be selected – Sweden's market has emerged as a rival – but investment banking advisers are already appointed. Visma, long-supported by UK-based private equity firm Hg Capital, is valued at at least €20bn, easily sufficient to enter the Footsie.

Other possibilities include:

• Bristol-based veterinary group IVC Evidensia, whose path to market is more defined following a regulatory review. It operates thousands of clinics in 19 countries.
• The RAC roadside recovery business (and possibly the AA too).
• The combined Waterstones and Barnes & Noble bookshop chains.
• Fintech payments platform Ebury and online travel agent Loveholidays.

An economic slowdown would probably stall progress, but the schedule of flotations looks in better shape than it has in a long time. "We have seen confidence slowly return with companies considering listing, who have been heartened by the market momentum," observes Brian Hanratty of broker Peel Hunt.

Challenges Remain

But London still requires an wave of innovation. During the mini-pick-up, payments firm Wise revealed a transfer of its primary listing to the US. At the same time, the ongoing attrition from M&A and departures kept shrinking the ranks of public companies; by the end of November, there were fewer than a thousand companies with a main market listing in London, down from 972 at the start of the year.

As part of fiscal policy, the finance minister proposed a three-year post-IPO stamp duty holiday. This small incentive on the levy on share purchases is likely a secondary factor for companies and their backers. Yet, it would prove advantageous if the flotation activity gathers pace in tandem. A sustained recovery is overdue – and has to be more than longer than a brief half-year.